HomeFinance, Earnings and Market ReportsRegulator rejects Nigerian MNOs' call for 40% price hike

    Regulator rejects Nigerian MNOs’ call for 40% price hike


    Regulation is about competition not collusion said NCC

    The Nigerian Communications Commission (NCC) has rejected the request by telecom operators for an upward review of tariffs, on the grounds of being unfair to subscribers and putting collusion before healthy competition among services providers. Mobile network operators (MNOs) belonging to the Members of the Association of Licensed Telecommunications Operators of Nigeria (ALTON) proposed a 40% price rise on calls, texts in response as the price doing business in Nigeria surged, according to reports in the Nigerian news site Punch.

    NCC does not approve

    In a statement issued at the weekend, NCC said it did not approve any increase, reports This Day. NCC’s Director of Public Affairs, Dr Ikechukwu Adinde, said any tariff increase by telcos must be approved by the commission, which is guided by cost-based and empirical studies to determine the appropriate price range to be adopted by the service providers. Adinde said points in the request letter from ALTON had been noted but any decision can only benefit subscribers if it maintains healthy competition among services providers.

    Cost of collusion

    “The NCC’s regulatory activities are guided by regular cost-based and empirical studies to determine the appropriate upper and floor price within which service providers can charge their subscribers for services delivered,” said the NCC’s official statement.  “For the avoidance of any doubt, and contrary to MNOs’ agitation to increase tariffs for voice and Short Messaging Services (SMS) by a certain percentage, the commission wishes to allay the fears of Nigerians. No tariff increase will be effected by the operators without due regulatory approval by the commission.”

    No price rise

    The NCC referred ALTON to Sections 4, 90, and 92 of the Nigerian Communications Act (NCA) 2003 which compel the NCC interests of subscribers against unfair practices including matters relating to tariffs and charges. The current tariff regime administered by the service providers is a product of NCC’s decision both for voice and SMS. “While there could be justifiable reasons for MNOs’ demand for tariff increase, it should be noted that they are not allowed to do such either individually or collectively without recourse to NCC, following the outcome of a cost study, said its statement, adding, “this is not the case for now.” Healthy competition among the licensees has ‘democratised’ the cost of services, NCC claimed, and this has made  subscriptions affordable for many Nigerians.